I'm with wikipedia on this one: "Application software, also known as an application or an app, is computer software designed to help the user to perform specific tasks." From http://en.wikipedia.org/wiki/Software_application
Application software is such a vague and undescriptive word that it's better to just use the terms "program" and "software" as they're impossible to misuse or argue about.
Wikipedia uses the term "utility" to refer to programs like mount, although again, just call it a program and be done with it.
